The circuit opened on 8 December 1985. In its first full year of international operation in 1986 it hosted both a significant motorcycle Grand Prix event and the Formula One Spanish Grand Prix in April, marking the first time an international motorcycle event had been held in Spain. The circuit's remote location relative to major Spanish population centres limited spectator turnout despite a capacity of up to 125,000. Formula One moved its Spanish race to Barcelona after the 1990 event.
In 1990, qualifying for the Spanish Grand Prix saw British driver Martin Donnelly suffer a career-ending accident. To commemorate this and address safety concerns at the corner where it occurred, a new chicane named the Senna curve was created during 1992 modifications — named in honour of Ayrton Senna — ahead of the circuit's return to the Formula One calendar for the 1994 European Grand Prix. That same 1992 revision also eliminated four corners to form the long Curva Sito Pons right-hander.
Jerez returned to the Formula One World Championship as host of the 1994 and 1997 European Grands Prix. The 1997 edition proved particularly dramatic: it was the championship decider between Michael Schumacher and Jacques Villeneuve, the two title contenders colliding during the race with Villeneuve going on to claim the World Championship. The race was further marked by an incident during podium celebrations when Jerez's mayor Pedro Pacheco disrupted proceedings by presenting a trophy intended for a Daimler-Benz dignitary. The incident resulted in the circuit being informally banned from hosting a further Formula One Grand Prix, and it has not done so since. Jerez continued as a popular winter testing venue for Formula One teams through 2015.
The track was resurfaced in 2005. Planned hosting of Champ Car World Series racing in 2008 did not materialise after the series merged with IndyCar early that year. In May 2013 the circuit's final corner was renamed after four-time world motorcycle champion Jorge Lorenzo. On 3 May 2018 the entire circuit was renamed in honour of Ángel Nieto, the Spanish motorcycle racer who died in 2017 after winning twelve FIM World Championships. On 3 May 2019 the sixth corner, formerly known as Curva Dry Sac, was renamed after Dani Pedrosa, the three-time world champion who retired in 2018.
Jerez currently hosts the Spanish motorcycle Grand Prix as a round of the MotoGP World Championship, typically held in early May. The Superbike World Championship visits annually in October, accompanied by the Supersport World Championship. The circuit also hosts the FIM Moto3 Junior World Championship, the Moto2 European Championship, national-level Formula 4 and GT championships, and various winter testing programmes.
The circuit's hot-summer Mediterranean climate, with mild and rainy winters and hot, dry summers, makes it a preferred winter and early-season testing venue. Temperatures during January and February testing simulate shoulder-season race conditions across Europe. The outright track record is 1:15.651, set by Pedro de la Rosa in a McLaren MP4-20 during Formula One testing in April 2005.
Several fatalities have occurred at Jerez during motorsport events: Nobuyuki Wakai in 1993, Javier Moreno in 1990, Marcos Garrido in 2019, Ismael Bonilla in 2020, and Dean Berta Viñales — aged 15 — during a Superbike World Championship event on 25 September 2021.